When starting-up a new venture, resources, time and cash are constraint. The Open Incubation venture governance model recognises four building blocks: Role & Contribution, Rewards, Values and Rules of Engagement. Where resources, time and cash are the ‘Contributions’ of the venture team to get started, ‘Rewards’ is what the venture team gets in return.
Most founders don’t realise there are more currencies than cash and equity only. The following categorisation of rewards will help you think about your venture currencies more creatively:
- Leadership relates to the level of influence someone has on the strategic direction of the venture. Examples are leadership roles, (advisory) board seats and voting rights;
- Ownership relates to the type and level of ownership. Examples are entitlement to (shared) assets, intellectual property or (future) equity ownership;
- Cash relates to cash based compensation such as a management fee, fixed fee, succes fee or revenue share;
- In kind compensation relates to a non-cash compensation such as products, services, learnings and shared IP.
For many business leaders being involved in a start-up is most and for all a learning experience. Think about the sharing of learnings as a currency. Open source code is another great example of a currency. Developers are more willing to work with you if the code is being shared.
Creating an overview of the rewards a venture could offer is a very rewarding and creative process. Based on their envisaged roles and contributions, the venture team will discuss the rewards they are entitled to. In the picture, you will see an overview of an illustration of Rewards we use in Open Incubation labs.
Download a free copy of the Open Incubation Rewards Canvas
For more information on the Open Incubation governance model, please download the Open Incubation white paper
